The Usefulness of Social Norm Theory in Empirical Business Ethics Research: A Review and Suggestions for Future Research

In response to recent calls to extend the underlying theories used in the literature (O’Fallon and Butterfield in J Bus Ethics 59(4):375–413, 2005; Craft in J Bus Ethics 117(2):221–259, 2013), we review the usefulness of social norm theory in empirical business ethics research. We begin by identifying the seeds of social norm theory in Adam Smith’s (in: Raphael and Macfie (eds) The Theory of Moral Sentiments, the Glasgow Edition, Oxford University Press, Oxford, 1759/1790) seminal work, The Theory of Moral Sentiments. Next, we introduce recent theory in social norm activation by Bicchieri (The grammar of society: The nature and dynamics of social norms, Cambridge University Press, New York, 2006) and compare the new theory to two theoretical frameworks found in the literature: Kohlberg’s (in: Goslin (ed) Handbook of socialization theory and research, Rand McNally, Chicago, IL, 1969; in: Lickona (ed) Moral development and behavior, Holt, Rinehart & Winston, New York, 1976) theory of moral development and Cialdini and Trost’s (in: Gilbert et al. (eds) The handbook of social psychology, Oxford University Press, Boston, 1998) taxonomy of social norms. We argue that the new theory provides useful insights by emphasizing the ability of situational cues and information to generate common expectations for social/moral norms. The theory is particularly useful for empirical research in business ethics because it gives both organizational and individual factors a role in motivating norm-based behavior. To demonstrate this usefulness, we present examples where the theory has been effectively applied in experimental accounting research to generate new insights. We conclude by citing specific examples where the theory may prove useful in empirical business ethics research.     

Moral Vision: Iris Murdoch and Alasdair MacIntyre

This article explains Iris Murdoch’s notion of moral vision and its importance as a basic concept within applied ethics. It does so by exploring the influence of Iris Murdoch upon Alasdair MacIntyre whose ideas are frequently discussed by business ethicists. Arguably, the British philosopher Iris Murdoch (1919–1999) who wrote – amongst others – Metaphysics as a Guide to Morals (1992), along with her contemporaries, Philippa Foot and Elizabeth Anscombe, pioneered the resurgence of Aristotle’s virtue ethics. Furthermore, Iris Murdoch influenced Alasdair MacIntyre. Heather Widdows, in her biography of Iris Murdoch lists Alasdair MacIntyre amongst those ‘thinkers she inspired’ (Widdows, The moral vision of Iris Murdoch, Ashgate Publishing, Aldershot, 2005, p. 10). And in his writings MacIntyre does both examine Murdoch’s work and acknowledge that ‘Iris Murdoch has … put us all in her debt’ (MacIntyre, 1993, The New York Times on the Web, January 3, http://www.nytimes.com/books/98/12/20/specials/murdoch-metaphysics.html, p. 3). Murdoch was both an influential philosopher and a successful novelist. MacIntyre has stated that ‘Iris Murdoch’s novels are philosophy: but they are philosophy which casts doubt on all philosophy, including her own’ (London Review of Books, 3–16 June, 1982, p. 15). I therefore explore in this article the influence of Iris Murdoch’s literary work, where ‘true vision occasions right conduct’ upon Alasdair MacIntyre’s portrayal of us as ‘storytelling animals’ on a ‘narrative quest’.     

Virtue Ethics and the Practice–Institution Schema: An Ethical Case of Excellent Business Practices

This paper aims to contribute to a greater understanding of the theory of virtue ethics and its applications in the business arena. In contrast to other prominent approaches to ethics, virtue ethics provides a useful perspective in making sense of various business ethics issues with an emphasis on the moral character of the individuals and its transformational influences in driving ethical business conduct. Building on Geoff Moore’s (Bus Ethics Q 12(1):19–32, 2002; Bus Ethics Q 15(2):237–255, 2005; Bus Ethics Q 18(4):483–511, 2008) treatment of Alasdair MacIntyre’s practice–institution schema, the paper discusses how individuals, as moral agents, can serve to promote virtuous business conduct and help foster a moral and ethical climate in the organization and in society at large. Using interview data from a broader study of the New Zealand wine industry as explanatory examples, the paper argues that while many companies’ sustainable practices are still largely market based, such excellent business practices are often driven by individuals’ moral and ethical pursuits.     

Action Research As an Ethics Praxis Method

Action research is combined research and practical action where the researcher joins with and acts with practitioners to help improve practice and theory building. Action research can be a form of Aristotelian critical, ethical praxis that developmentally changes the action researcher and the external world. Bernstein’s (Praxis and action, 1971) and Eikeland’s (The ways of Aristotle, 2008) interpretations of Aristotelian ethics praxis are considered. The Argyris et al. (Action science: concepts, methods, and skills for research and intervention, 1985) “action-science” and the van de Ven (Engaged scholarship: A guide for organizational and research knowledge, 2007) “engaged scholarship” forms of action research with their differently nuanced interpretations of Aristotelian philosophy as foundations for action research are considered and compared as examples of action research as an ethics praxis method with respect to (1) a key similarity with respect to joining of critical ethics and actionable knowledge; (2) another key similarity with respect to action research practice that can developmentally change the action researcher and the external world; and (3) a key difference with respect to academic literature versus practitioner-based theory building is also considered (Nielsen J Bus Ethics 93:401–406, 2010a). Examples in the cases of the political economist and action researcher, Hirschmann’s “Exit,Voice, Loyalty” approach and Greenleaf’s “Servant Leadership” approach to action research as forms of Aristotelian critical, ethical praxis are analyzed.     

Editorial Essay: Mapping the Ethical in Neuroscientific Research

The unmanaged organization (Gabriel in Organ Stud 16:477–501, 1995) is moving from coffee corners to social networks. This means not only a change of media, but also a transformation in how organizations exert control over workers and how workers resist the commodification of emotions (Fineman, in: Fineman, Emotion in organizations, Sage, London, 2000; Lindebaum in J Manag Inq 21:262–277, 2012). After analyzing instances of the online publication of images and texts that escape organizational control, we identified three main ambiguities helpful in framing future studies about organizational control and resistance: ambiguity between private and public spheres, ambiguity between spontaneous and performed manifestations, and ambiguity between the distribution and control of power. Our main contribution is to understanding the Internet, particularly social networks, as a medium for employee resistance through distance (Collinson, in: Jermier et al., Resistance and power in organizations, Routledge, London, 1994), and in using the three aforementioned ambiguities to help analyze this phenomenon.     

Whistleblowing and Information Ethics: Facilitation,Entropy, and Ecopoiesis

The economic and moral defense of sweatshops given by Powell and Zwolinski (J Bus Ethics 107:449–472, 2012) has been criticized in two recent papers. Coakley and Kates (J Bus Ethics 117:553–558, 2013) focus on putative weaknesses in the logic of Powell’s and Zwolinski’s argument. Preiss (Bus Ethics Quart 24(1):55–82, 2014) argues that, even granting the validity of their economic argument, Powell’s and Zwolinski’s defense is without force when viewed from a Kantian republican viewpoint. We are concerned that sweatshop critics have misinterpreted the economic literature and overstated the conclusions that follow from their ethical premises. We show that the best understanding of the current economic literature supports Powell’s and Zwolinski’s conclusions about the negative effects of sweatshop wage regulation, and that it is unreasonable to reject economic analysis in moral argument against sweatshops even from a Kantian perspective. Additionally, we defend the theory of exploitation as unfairness given by Wertheimer (Exploitation, 1996), and show how economic analysis can be applied to that theory to identify cases of sweatshop exploitation.     

Strengthening “Giving Voice to Values” in Business Schools by Reconsidering the “Invisible Hand” Metaphor

The main contention of this paper is that our ability to embed a consideration of values into business school curricula is hampered by certain normative parameters that our students have when entering the classroom. If we don’t understand the processes of valuation that underpin our students’ reasoning, our ethics teaching will inevitably miss its mark. In this paper, we analyze one of the most prevalent metaphors that underpin moral arguments about business, and reveal the beliefs and assumptions that underpin it. By revisiting the content of Adam Smith’s “invisible hand” metaphor, we show that the moral content of the metaphor has been significantly misconstrued through its subsequent reception in economic theory. The “Giving Voice to Values” (GVV) pedagogy aims to enable students to act on their tacit values and address the rationalizations that they may encounter for not acting on these values (Gentile in Giving voice to values. How to speak your mind when you know what’s right, Yale University Press, Yale, 2010a; Discussions about ethics in the accounting classroom: student assumptions and faculty paradigms, Darden Business Publishing,2010b. http://store.darden.virginia.edu/Syllabus%20Copy/Discussions-about-Ethics-in-Accounting_S.pdf; Educating for values-driven leadership across the curriculum: giving voice to values, Business Expert Press, New York, 2013). We believe our analysis can strengthen the employment of GVV in three ways: (1) understanding tacit blockages to moral action, i.e., how students’ belief in the moral efficacy of the invisible hand could undermine their own sense of moral duty; (2) addressing common rationalizations that may emerge from different assumptions about morally appropriate courses of action in the workplace; and (3) resolving values conflicts on how to act.     

Appointing Women to Boards: Is There a Cultural Bias?

Companies that are serious about corporate governance and business ethics are turning their attention to gender diversity at the most senior levels of business (Institute of Business Ethics, Business Ethics Briefing 21:1, 2011). Board gender diversity has been the subject of several studies carried out by international organizations such as Catalyst (Increasing gender diversity on boards: Current index of formal approaches, 2012), the World Economic Forum (Hausmann et al., The global gender gap report, 2010), and the European Board Diversity Analysis (Is it getting easier to find women on European boards? 2010). They all lead to reports confirming the overall relatively low proportion of women on boards and the slow pace at which more women are being appointed. Furthermore, the proportion of women on corporate boards varies much across countries. Based on institutional theory, this study hypothesizes and tests whether this variation can be attributed to differences in cultural settings across countries. Our analysis of the representation of women on boards for 32 countries during 2010 reveals that two cultural characteristics are indeed associated with the observed differences. We use the cultural dimensions proposed by Hofstede (Culture’s consequences: International differences in work-related values, 1980) to measure this construct. Results show that countries which have the greatest tolerance for inequalities in the distribution of power and those that tend to value the role of men generally exhibit lower representations of women on boards.     

Reconceptualizing CSR in the Media Industry as Relational Accountability

In this paper, we reconceptualize CSR in the media industries by combining empirical data with theoretical perspectives emerging from the communication studies and business ethics literature. We develop a new conception of what corporate responsibility in media organizations may mean in real terms by bringing Bardoel and d’Haenens’ (European Journal of Communication 19 165--194 2004) discussion of the different dimensions of media accountability into conversation with the empirical results from three international focus group studies, conducted in France, the USA and South Africa. To enable a critical perspective on our findings, we perform a philosophical analysis of its implications for professional, public, market, and political accountability in the media, drawing on the insights of Paul Virilio. We come to the conclusion that though some serious challenges to media accountability exist, the battle for responsible media industries is not lost. In fact, the speed characterizing the contemporary media environment may hold some promise for fostering the kind of relational accountability that could underpin a new understanding of CSR in the media.     

Sustainable Development and Well-Being: A Philosophical Challenge

This paper aims at gaining a better understanding of the inherent paradoxes within sustainability discourses by investigating its basic assumptions. Drawing on a study of the metaphoric references operative in moral language, we reveal the predominance of the ‘well-being = wealth’ construct, which may explain the dominance of the ‘business case’ cognitive frame in sustainability discourses (Hahn et al. in Acad Manag Rev 4015:18–42, 2015a). We incorporate economic well-being variables within a philosophical model of becoming well (Küpers in Cult Organ 11(3):221–231, 2005), highlighting the way in which these variables consistently articulate a combination of ‘objective’ and ‘subjective’ concerns. We then compare this broad understanding of well-being with the metaphors operative in the sustainable development discourse and argue that the sustainability discourse has fallen prey to an overemphasis on the ‘business case’. We proceed to draw on Georges Bataille to challenge the predominance of these value priorities and to explore which mindshifts are required to develop a more comprehensive understanding of what is needed to enable ‘sustainable development’.     

International entrepreneurship in universities: Context,emergence and actors

This special issue presents an opportunity to explore the international aspects of academic and university based international entrepreneurship. Over the last decades much research attention has been focused on university spin-off firms (USOs) on issues such as, creation, risk, strategies and performance (see Druilhe and Garnsey, 2004; Link and Scott, 2005; Lockett and Wright, 2005; Walter et al, 2006; Wright et al., 2006). There has been a dearth of studies that have examined the international dimensions and aspects of university-based spin-off firms. The six articles presented in this special issue point towards interesting future research agendas at the interface between academic and international entrepreneurship. Three core themes emerge from this special issue: Context, Emergence and Actors. In sum, this special issue pinpoints: firstly, specific features of universities and research organizations as contexts for international technology entrepreneurship; secondly, the process of organizational emergence and entrepreneurial cognition; and thirdly, insight into learning processes of USOs and the role of non-academic actors. Our article concludes by identifying future avenues of research.     

A Fair Trade-off? Paradoxes in the Governance of Fair-trade Social Enterprises

This paper explores how fair trade social enterprises (FTSEs) manage paradoxes in stakeholder-oriented governance models. We use narrative accounts from board members, at governance events and board documents to report an exploratory study of paradoxes in three FTSEs which are partly farmer-owned. Having synthesized the key social enterprise governance literature and framed it alongside the broader paradox theory, we used narratives to explore how tensions are articulated, how they can be applied within an adapted paradox framework, and how governance actors seek to mitigate paradoxes. The paper contributes to current debates in social enterprise scholarship concerning hybridity (Pache and Santos, Acad Manag Rev 35(3):455–476, 2010; in Institutional logics in action, Part B (Research in the sociology of organizations), 2012), hybrid organizing (Battilana and Lee, Acad Manag Ann 8(1):397–441, 2014) and operational tensions (Smith et al., Bus Eth Q 23(3):407–442, 2013) by illustrating empirically how the central social/enterprise paradox manifests in FTSEs governance arrangements. We build on the paradox categories proposed by Lüscher and Lewis (Acad Manag J 51(2):221–240, 2008) and adapted in Smith et al. (Bus Eth Q 23(3):407–442, 2013) by developing a recursive model of legitimacy-seeking governance processes, conceptualizing how boards seek to mitigate, but not necessarily resolve, paradoxes.     

Do they Know it’s CSR at all? An Exploration of Socially Responsible Music Consumption

Porter and Kramer (Harv Bus Rev 84(12):78–92, 2006; Harv Bus Rev 89(1/2), 62–77, 2011) introduced ‘shared value’ as a ‘new conception of capitalism,’ claiming it is a powerful driver of economic growth and reconciliation between business and society. The idea has generated strong interest in business and academia; however, its theoretical precepts have not been rigorously assessed. In this paper, we provide a systematic and thorough analysis of shared value, focusing on its ontological and epistemological properties. Our review highlights that ‘shared value’ has spread into the language of multiple disciplines, but that its current conceptualization is vague, and it presents important discrepancies in the way it is defined and operationalized, such that it is more of a buzzword than a substantive concept. It also overlaps with many other (related) concepts and lacks empirical grounding. We offer recommendations for defining and measuring the concept, take a step toward disentangling it from related concepts, and identify relevant theories and research methods that would facilitate extending the knowledge frontier on shared value.     

Do Investors See Value in Ethically Sound CEO Apologies? Investigating Stock Market Reaction to CEO Apologies

Since the late 1990s, the number of apologies being offered by CEOs of large companies has exploded (Lindner in Austin American-Statesman, 2007; Adams in USA Today, 2000). Communication and management scholars have analyzed whether and why some of these apologies are more effective or more ethical than others (Souder in Sci Eng Ethics 16:175–184, 2010; Benoit in Accounts, excuses, and apologies: a theory of image restoration strategies, 1995a; Benoit and Czerwinski in Bus Commun Q 60:38–57, 1997). Most of these analyses, however, have remained at the anecdotal level. Moreover, the practical, economic consequences of apologies have not been examined. Almost no rigorous or systematic empirical work exists that examines whether stakeholders (1) reward firms whose CEOs give apologies that are more, rather than less, ethical; and (2) punish firms whose corporate apologies are not ethically sound. This lacuna is surprising given that the whole purpose of an apology is to restore trust between the apologizer and the recipients of the apology. It is also surprising, given that stock market participants do appear, in at least some cases, to evaluate and respond to apologies by CEOs. When Johnson and Johnson was hit by the Tylenol poisonings, its stock price plummeted. One day after CEO James Burke’s apology—an apology widely praised for being ethically sound—approximately a half billion dollars of its previously lost stock value was restored (The financial effect of Burke’s 1982 apology was calculated using Eventus data for a window ?1, +1 days around the date of the actual apology.). It appears, then, that a good CEO apology may lead to an increased stock value ceteris paribus. But is the Johnson and Johnson case representative of how the market responds in general to CEO apologies?     

My Boss is Morally Disengaged: The Role of Ethical Leadership in Explaining the Interactive Effect of Supervisor and Employee Moral Disengagement on Employee Behaviors

The popular press is often fraught with high-profile illustrations of leader unethical conduct within corporations. Leader unethical conduct is undesirable for many reasons, but in terms of managing subordinates, it is particularly problematic because leaders directly influence the ethics of their followers. Yet, we know relatively little about why leaders fail to apply ethical leadership practices. We argue that some leaders cognitively remove the personal sanctions associated with misconduct, which provides them with the “freedom” to ignore ethical shortcomings. Drawing on moral disengagement theory (Bandura 1986, 1999), we examine the relationship between supervisor moral disengagement and employee perceptions of ethical leadership. We then examine the moderating role of employee moral disengagement, such that the negative relationship between supervisor moral disengagement and employee perceptions of ethical leadership is stronger when employee moral disengagement is low versus high. Finally, we examine ethical leadership as a conditional mediator (based on employee moral disengagement) that explains that relationship between supervisor moral disengagement and employee job performance and organizational citizenship behavior (OCB). Results from a multi-source field survey provide general support for our theoretical model.     

A Scale for Measuring Consumer Perceptions of Corporate Social Responsibility Following the Sustainable Development Paradigm

The aim of this research is to develop and validate a measurement scale for consumer’s perceptions of corporate social responsibility (CSRConsPerScale) using the three-dimensional social, environmental and economic conceptual approach as a theoretical basis. Based on the stages of measurement scale creation and validation suggested by DeVellis (Scale development: theory and applications, 1991) and supported by Churchill Jr.’s (J Mark Res 16(1):64–73, 1979) suggestions, five different empirical studies are developed expressly and applied to consumers of tourist services. This research involves 1147 real tourists from 24 countries in two different cultural and geographical contexts. A three-dimensional 18-item scale is proposed for measuring consumer perceptions of corporate social, environmental and economic responsibilities. This paper presents the complete development of the scale, as well as the implications and limitations of the main findings and the managerial implications.     

The effect of result publicity on self-serving attributional bias —— a social comparison perspective

Self-serving bias suggests that people tend to attribute success to internal factors and attribute failure to external factors (Bradley, J Pers Soc Psychol 36:56–71,1978; Miller and Ross, Psychol Bull 82:213–225,1975). However, the results of the attribution of failure are not always consistent. Some studies have found that people attribute failure to external factors (Snyder, Stephan, & Rosenfileld, 1976) and others suggest that people attribute failure to internal factors (Ross et al., J Pers Soc Psychol 29:609–618,1974). I tested self-serving bias in two different contexts in mainland China: in one, test results were public (students had access to each other’s test results) and in the other, test results were private (students only had access to his/her own results). When a context triggers individuals to compare themselves to others, individuals may alter their attribution of failure in order to preserve their self-image and self-esteem. Data were analyzed by repeated measure ANOVA, and the results show that in a public context people tend to attribute failure more to external factors than to themselves. Also, results suggest that people attribute failure less to themselves in a public context than in a private context.     

Social Constructivism,Mental Models,and Problems of Obedience

There are important synergies for the next generation of ethical leaders based on the alignment of modified or adjusted mental models. This entails a synergistic application of moral imagination through collaborative input and critique, rather than “me too” obedience. In this article, we will analyze the Milgram results using frameworks relating to mental models (Werhane et al., Profitable partnerships for poverty alleviation, 2009), as well as work by Moberg on “ethics blind spots” (Organizational Studies 27(3):413–428, 2006), and by Bazerman and Chugh on “bounded awareness” (Harvard Business Review, 2006; Mind &; Society 6:1–18, 2007) Using these constructs to examine the Milgram experiment, we will argue that the ways in which the experiments are framed, the presence of an authority figure, the appeal to the authority of science, and the situation in which the naïve participant finds herself or himself, all create a bounded awareness, a narrow blind spot that encourages a climate for obedience, brackets out the opportunity to ask the moral question: “Am I hurting another fellow human being?” and may preclude the subject from utilizing moral imagination to opt out of the experiment. We will conclude that these forms of almost blind obedience to authority are correctable, but with difficulty. We will argue that linking the modification of mental models to an unbinding of awareness represents an important synergistic relationship and one that can build effectively on the lessons learned from our experience with moral imagination.     

Entrepreneurial Error Does Not Equal Market Failure

Barnett and Block (2015) claim that Bagus and Howden (2012b) support indirectly the concept of market failure. In this paper, we show that maturity mismatching in an unhampered market may imply entrepreneurial error but cannot be considered a market failure. We demonstrate why fractional-reserve banking leads to business cycles even if there is no central bank and why maturity mismatching does not per se lead to clusters of errors in a free market. Finally, in contrast to the examples provided by Barnett and Block, we assure that maturity mismatching does not imply the creation of two incompatible contracts due to the fungible nature of money.     

Internationalization of an academic invention through successive science-business networks: The case of TAVI

The aim of this paper is to explain how new technology ventures move, grow, and scale. Such ventures internationalize much faster than depicted by the traditional Uppsala model (Johanson and Vahlne, J Int Bus Stud 8:23–32, 1977; Johanson and Vahlne, Mark Rev 7(4), 1990; Johanson and Vahlne, J Int Entrep 1:83–101, 2003; Johanson and Vahlne, Manag Int Rev 46:165–178, 2006; Oviatt and McDougall, J Int Bus Stud 25:45–64, 1994). According to the Uppsala model, the main reason it takes time is that entrepreneurs need to build networks and learn. Many scholars have investigated how they may be able to learn faster and grow networks more effectively. While these explanations contribute to a better understanding of the process, they appear disturbingly insufficient. By means of an in-depth case study, we aim at identifying how learning and network-building constraints may be circumvented. We have investigated the internationalization process of an invention at a Danish university hospital that became a new technology within minimally invasive heart surgery. While the invention took place in the periphery of the international medical network, the venture circulated to the most competent international science-business networks to mobilize resources and competencies. We found that its ability to succeed resulted from its roots in international academic networks and its connecting to core nodes in these as well as in adequate business networks—including, in particular, Venture Capital firms that are in the business of developing and scaling such technology ventures. We also found that the innovation process evolved through phases that called for different resources and capabilities. It thereby offered opportunities for actors, networks, and companies that control such capabilities to move in to take control and pull the venture through the next phase. The process is less like a long distance run, and more like a relay race. This radically reduces the need to learn as the new venture expands and scales.